McDonalds Business Proposal Paper
McDonalds’ Business Proposal
This proposal is based on the current debate of whether McDonalds should add a “happy meal” option to their breakfast menu or not. Adding this option will allow parents to purchase child sized portions of breakfast foods for their children instead of potentially wasting food by buying the regular portion sizes. The current demand by many customers of McDonalds is for more options for their children. Recently, McDonalds started adding a bag of five apple slices to each happy meal handed out. This was a great option and surveys of customers proved that this was the right direction to take in the effort to make fast food meals more healthy for children. Now, there are many parents asking the question, “why are there no childrens’ options for breakfast?”. This proposal will explore in brief, how McDonalds can add to their menu and their profits by offering children’s portions of breakfast items.
Profit-Maximizing and Increasing Revenue
Profit-maximizing quantity is figured by determining the elasticity of the product. The elasticity of this particular product is determined by the individual instead of the population due to the fact that fast food is typically considered an elastic good. An elastic good is one that is considered to be more of a luxury since it is not required to survive. So, with this being an elastic good, the price must be set at a reasonably low level to increase the revenue. McDonalds can determine the best price by using the formula, “marginal cost = marginal revenue”.
In regular terms, fast food breakfasts are an elastic good or a luxury. Not everyone can afford to “eat out” every day, causing a McDonalds’ breakfast happy meal to be an elastic good. With that being said, there are many people who do go out to breakfast on their way to work or on their way to drop their children off at school. With this proposal, McDonalds will be providing a healthier...